Results briefing for the 3rd quarter of Fiscal Year ending December

Transcription

1 Results briefing for the 3rd quarter of Fiscal Year ending December November, Coca-Cola West Company, Limited (2579) [Contact] Planning Department (IR team) TEL FAX [URL] [ ] junko-kubo@ccwest.co.jp

2 Agenda Ⅰ. Account settlement for Q3 YTD Ⅱ. Plans for Q4 and Full-year Ⅲ. Topics [Reference] Account settlement for Q3(July-September) Trend of OTC market share Mix by brand/by channel Sales update on vending machines by channel Q3 Actual sales volume Sales volume by channel and by package Q4 Volume plan Performance trend / managerial KPI trend Coca-Cola System in Japan / Affiliated companies 1

3 Ⅰ. Account settlement for the Q3 2

4 Account settlement for Q3 YTD- Sales volume Sales volume resulted in behind Plan, but increased vs. PY. (real comparison) In Q3, although could not reach the Plan volume due to unfavorable weather after mid- August, finished surpassing the result from previous year. Ref Real comparison Q YTD actual vs. Plan 1 vs. PY vs. PY 2 (Unit:K C/S % ) Diff % Diff % Diff % Sales volume 163, , CCW area 142,538 M.Kyushu area(apr-sep) 20,754 *1 Plan refers to the figures based on the performance forecast published on July 26, *2 PY actual figures include April-September performance of Minami Kyushu CCBC. Monthly volume trend (vs. PY 2 ) (% ) (5) Jan Feb Mar Apr May Jun Jul Aug Sep Jan-Sep +0.2 Jul-Sep

5 Actual settlement for Q3 YTD - Sales volume by channel Chain Store outperformed the Plan and PY. Volume expanded mainly SS PET at super markets On the other hand, convenience stores was unfavorable V. Plan and PY, struggled with GA & Ilohas Highly profitable Vending underperformed both the Plan and PY in volume. Active Vending machines did not meet the plan and on the declining trend from PY Although the positive Impact from value promotions, VPM *1 dropped. Supermarket (Unit: K C/S, % ) Ref Real comparison Diff % Diff % Diff % 3 50, , , Convenience store 17, , Chain store Total Q3 YTD Actual vs. Plan 2 vs. PY vs. PY 4 68, , , Vending 44, , , Retail 11, , Food service 15, , Other 23, , Total 163, , *1 Sales volume per unit of vending machine *2 Plan refers to the figures based on the performance forecast published on July 26, 2013 *3 Drug store/discounter/home center are included in supermarket * 4 PY actual figures include April-September performance of Minami Kyushu CCBC. 4

6 Actual settlement for Q3 YTD - Sales volume by package Highly profitable SS PET was surpassed plan and outperformed PY. Bolstered sales of SS PET and Mini PET in Supermarket. Vending implemented switching to more convenient resealable PET from Cans. On the other hand, high-yielding Canisters were remarkably behind Plan and PY. Stagnated sales of Georgia. Strategic switchover to PET (resealable products) Ref Real comparison (Unit: K C/S, %) Q3 YTD Actual Vs. Plan 1 Vs. PY Vs. PY 2 Diff % Diff % Diff % SS (1,000ml or smaller) 44, , , MS (smaller than 1,500ml ) 1, PET LS (1,500ml or larger) 34, , Total 80, , , Can (include bottle can Other Syrup, powder Total 40,892-1, , , , , , , , * 1 Plan refers to the figures based on the performance forecast published on July 26, 2013 * 2 PY actual figures include April-September performance of Minami Kyushu CCBC. 5

7 Actual settlement for Q3 YTD - Sales volume by brand Coca-Cola and Coca-Cola Zero turned positive both plan and PY due to the impact from campaigns. Volume of Ayataka and AQ exceeded plan and PY due to the coverage reinforcement in Summer and activations for share increase. GA struggled sales at vending and convenience store, significant plunge vs. plan and PY. Core 8 (Unit:K C/S, % ) Ref Real comparison Vs. Plan 2 Vs. PY Vs. PY 3 Diff % Diff % Diff % Coca-Cola 11, , Coca-Cola Zero 5, , Fanta 6, , Georgia 31, , , Sokenbicha 9, Aqarius 19, , , Ayataka 10, , , Ilohas 7, Subtotal 102, , , Other 28, , RTD 1 Total 131, , Syrup/Powder 31, , Total Q3 YTD Actual 163, , * 1 Packaged products * 2 Plan refers to the figures based on the performance forecast published on July 26, 2013 * 3 PY actual figures include April-September performance of Minami Kyushu CCBC. 6

8 Actual settlement for Q3 YTD (Unit:MM JPY %) 2013 Q3 YTD Actual Vs. Plan 2012 Vs. PY Plan Q3 YTD Diff % Actual Diff % Revenue 327, ,600-3, , , Gross profit 163, ,700-3, , , Operating income Ordinary income 13,302 14, ,457 +2, ,017 14, ,460 +3, Net income 15,832 16, , , [Ref] Real comparison (PY actual figures include April-September performance of Minami Kyushu CCBC) (Unit:MM JPY %) 2013 Q3 YTD Actual * Plan refers to the figures based on the performance forecast published on July 26, 2013 Vs. PY Diff % Revenue 327,218-2, Operating income 13,302 +1,

9 Actual settlement for Q3 YTD -Causes of Difference (comparison with Plan*) Plan 2013 Q3 YTD Actual Diff Key causes (Unit:000MM JPY) Diff (val) Revenue 3,306 3, Coca-Cola business Healthcare/skincare business -3.0 Gross profit On sales 1,667 1, Coca-Cola business Healthcare/skincare business -2.5 Increase/decrease of SG&A Decrease of labor cost +5.7 Decrease of promo/advertisement cost +2.3 Decrease of sales commissions +2.4 Operating Increase of sales equipment cost -3.0 income Decrease of outsourcing cost +7.6 Increase of transportation cost -7.6 Decrease of depreciation costs +1.9 Healthcare/skincare business +3.9 Ordinary income Current net profit Corporate tax, etc +4.2 * Plan refers to the figures based on the performance forecast published on July 26,

10 Actual settlement for Q3 YTD - Causes of Difference in operating income (Comparison with plan*) In Coca-Cola business, in addition to the decreasing sales volume and worsened channel mix, marginal profit is also declined due to lowered WSP in chain stores. Despite the effort of company-wide cost reduction, operating income ended below the plan. On the other hand, Healthcare & Skincare business s OI improved by 0.1B JPY vs. plan. Decrease of marginal profit Coca-Cola business (-11.4) (Unit:000MM JPY) Decline of WSP -21 Chain stores -19 Vending -2 Impact of SCM +2 Other (SCM) +1 Decrease of promotion-related activities Improve self production Decrease of labor cost +5 Decrease of other cost Decrease of repair/ maintenance cost Healthcare & Skincare Business +1 (-10) Plan 2012 Q3 Actual * Plan refers to the figures based on the performance forecast published on July 26,

11 Actual settlement for Q3 YTD -Causes of Difference (Comparison with PY) PY 2013 Q3 YTD Actual Diff Key causes of difference (Unit:000MM JPY) Diff(val) Revenue 2,964 3, Coca-Cola business Healthcare/skincare business +5.3 Gross profit On sales 1,463 1, Coca-Cola business Healthcare/skincare business +4.6 Increase/decrease of SG&A Increase of labor cost Increase of sales commissions Operating income Increase of sales equipment cost Increase of outsourcing cost -6.9 Increase of transportation cost Increase of depreciation costs -8.4 Healthcare/skincare business -8.4 Ordinary profit Increase of non-operating income (investment profit by equity method, etc) +8.7 Current net profit Increase of extraordinary profit (on negative goodwill) Increase of extraordinary loss (pertaining to phased acquisition etc.) Corporate tax, etc

12 Actual settlement for Q3 YTD - Causes of Difference in operating income (Comparison with PY) Marginal profit declined in Coca-Cola business vs. PY, due to dropped WSP mainly on large size PET. On the other hand, operating income was increased by 3.2B JPY vs. PY due to the impact from SCM and business consolidation with M. Kyushu CCBC. The causes of decreased Healthcare & Skincare business s OI of 0.4B JPY is for the advertisement cost invested to capture new customers in fist half. (Q3 OI increased 0.1B JPY vs. PY) 104 Decline of WSP -29 Chain stores -25 Vending -3 Impact of SCM +11 Coca-Cola business (+32) Decrease of promotion-related activities +5 Decrease of labor cost +6 Decrease of other cost +11 Impact of consolidation +3 Decrease of depreciation costs +3 Decrease of fuel costs +1 other Decrease of retirement benefit costs Impacts from Merger w/ M Kyushu +25 Healthcare & Skincare Business (+28) (Unit:000MM JPY) 2012 Q3 YTD Actual Decrease of material price +9 Self production of PET pkg Q3 YTD Actual 11

13 Ⅱ.Business Plan for the 4 th Quarter/full-year 12

14 Q 4 plan (Oct-Dec) Sales volume plan by Brand Core 8 brands are targeted for 2.9 % positive V. PY *1 [Ref] Real comparison (Unit: K c/s, % ) Q4 Plan Vs. PY Vs. PY 1 Diff % Diff % Core 8 Coca-Cola 3, Coca-Cola Zero 1, Fanta 2, Georgia 13,281 +2, Sokenbicha 2, Aquarius 3, Ayataka 3, Ilohas 2, Sub-total 32,473 +6, Other 9,719 +1, RTD 2 Products Syrup/Powder Total 42,192 +8, , , , ,626 +8, * 1 PY actual figures include Q4 performance of Minami Kyushu CCBC * 2 Packaged products 13

15 Brand strategy Key activities New products, renewals & communication Winter campaign (November onward) Collaboration of Polar bear and Coca-Cola Cola Christmas campaign Roll out of Christmas-limited packages Winter campaign Limited design packages For Christmas CCW Original Launch original new products Launching Chugoku area exclusive Buchi Expand HOT products Launch new products New products 280mlPET Slim PET Deploy National campaign Implement value promotion Vending, convenience stores National campaign 14

16 Brand strategy Key activities New products, renewals & communication Ensure product appeal Support hydration in dry season season as a theme to improve demand in Fall/Winter Roll out near pack promotion Reinforce AQ vitamin Acquire new user through near pack sampling AQ vitamin near pack sampling NST Fall season campaign Invigorate POCs by leveraging premium Tie-up campaign with movies Near pack promotion with discounted movie tickets Launch HOT products NST Fall season campaign TieTie-up campaign with Movie Kiyosu kaigi kaigi 15

17 Q 4 plan (Oct-Dec) Sales volume plan by Channel Boost Revenue and profit by enhancing volume and per-case Revenue in Chain stores. In vending, focus on new development activities to increase the number of vending machines along with the expansion of volume/revenue/profit by improved VPM 1 made possible by the reinforcement of OBPPC for Fall/Winter and leveraging promotions. [Ref] Real comparison (Unit: K cs, % ) Q4 Plan Vs. Plan Vs. PY 3 Diff % Diff % Supermarket 2 13,729 +3, Convenience store 6,073 +1, Chain store total 19,802 +4, , Vending 15,541 +3, Retail 3, Food Service 5, Other 7, , Total 52,626 +8, *1 Sales volume per unit of vending machine *2 Drug store/discounter/home center are included in supermarket * 3 PY actual figures include Q4 performance of Minami Kyushu CCBC. 16

18 Channel strategy - Chain stores Shifting from the uniform sales strategy in the past, identify target competitors through analyzing circumstances by prefecture. In doing so, develop and execute marketing strategies combining locally defined category & packages to maximize ROI. Initiatives to expand sales volume Activate PoCs fully aligned with campaign Place coolers and racks Initiatives to boost per-case revenue Enhance sales of SS PET products according to POC Improve package mix Equipment placement plan Expand coverage of mini PET(300ml) Shift to mini PET focused sales at checkout POCs when switching to HOT HOT products Coca-Cola TM Winter campaign +3,600 units (Number of active racks as of end of Sep 2013: units) Mini PET Sales plan (customers) +1,300 outlets (End of Sep, 2013 :2,500 outlets) Improve per-case revenue Aquarius Support hydration in dry season Package differentiation between customers business categories Prevent decline of shop price caused by price competition. Initiatives to improve performance management Execute effective and efficient sales activities based on the P&L analysis per account/per outlet. 17

19 Channel strategy - Vending Increase vending machines Enhance VPM* Reinforce development activities Q4 new placement plan 5,000 VMs Strengthen the portfolio New product launches (more hot products) Carry out M&A of vending operators Leverage Peak Shift machines Take advantage of Peak Shift vending machines strategically, to offer mainly big customers (indoor) to entrust us handling of entire VMs Ensure optimal portfolio for each machine Analyze sale data to deploy right portfolio, taking into account location attributes Strong promotional programs National campaign and value promotions Reinforce indoor location development by collaborating with retailers of office supplies Georgia National campaign 240,000 VMs All Georgia products * Sales volume per vending machine Georgia Value promotion 80,000 VMs 25,000 VMs Georgia 190g can Coca-Cola Zero Zero Limit campaign Coca-Cola & Coca-Cola Zero 500 PET 18

20 Performance plan for 4Q (Oct-Dec) / full year (Jan-Dec) The consolidated performance plan in Q4 will aim to increase income and profit vs. PY. Consolidated (Unit: MM JPY, %) Plan Q4 Full year Vs. PY Vs. PY Plan Diff % Diff % Revenue 110, , , , Gross profit on sales 55, , , , Operating income 3, ,800 +4, Ordinary income 3, ,900 +4, Current net profit 1, , , Coca-Cola business Ref Real comparison (Unit: MM JPY, %) Plan Q4 Full year Vs. PY Vs. PY Plan Diff % Diff % Full year Vs. PY Diff % Revenue 100, , , , , Operating income 1, ,300 +4, , * 3 PY actual figures include April-December performance of Minami Kyushu CCBC. 19

21 Q 4 plan (Oct-Dec) - Plan to achieve operating income target (comparison with Last year) Boost marginal profit of Coca-Cola business with Revenue growth in Chain stores and Volume growth in Vending. Moreover, implementing cost reduction along with creating positive impact of consolidation with Minami Kyushu CCBC, aim to achieve full year operating income target of 12.3B JPY. On the other hand, expecting profit increase of 0.1B JPY vs. PY in Healthcare/skincare business. (Unit: 000 MM JPY) 135 Q3 Actual +11 Increased profit Along with increased volume +3 Impact of SCM +1 Raw material etc 6 Other cost decrease +3 Integration impacts +2 Impacts from Merger w/ M Kyushu Healthcare & Skincare Business 55 (+1) Coca-Cola Healthcare & Skincare Business 54 Coca-Cola business Actual of 1 st half +21 Coca-Cola business Q4 (+10) business 123 (+42) Actual (Full year) 2013 plan (Full year) 20

22 Ⅲ.Topics 21

23 Transformation of the structure Organize functions retained as a bottler Specialized for the functions related to selling, manufacturing as the basic skill of bottlers Functions require expertise will be transferred to external cooperative companies in order to pursue quality & streamlined operations Transferred to external cooperative companies Regular delivery Target functions Site-to-site transportations Warehouse work Sales in non-urban areas, VM operations, regular delivery, site administrative operations Target quota Approx. 650 Centralize/re-allocate functions within group companies Centralize core-functions as a bottler, such as sales function or strategy planning function to CCW(HQ) Centralize functions that can create additional value, to functional companies within our group by specializing each group companies. Target functions Target quota Centralize/re-allocate within group companies site administrative operations, admin center, contact center VM operations, etc Approx. 2,000 22

24 Voluntary resignation Voluntary resignation system For employees who seeks opportunities in outside of our group, financial support and support for exploration will be provided. Recruiting number Period Resignation date Description of support Max. 300 people December 1, 2013 to Dec 20, 2013 (provisional) March 31, 2014 (provisional) Provision of additional lump-sum allowance for retirement, and re-employment support from re-employment support company Occurring expense along with the transfer, voluntary resignation( lump-sum allowance for transfer, additional lump-sum allowance for retirement, etc) will be calculated as extraordinary loss on this year s account settlement. The amount is unable to decide at this moment, will be announced as soon as it is decided. 23

25 Merger with Minami Kyushu group Aim for the early maximization of consolidation impact, the merger of CCW group and Minami Kyushu group will take place as of January 1, <As of Jan 1, 2014> Bottler Sales functional companies SCM functional companies Service functional company CCW Group M.Kyushu group CCW CCWV NNB CCWES CCWP CCWDP Merger Merger Merger Merger M.Kyushu MBS KCS KCSC MCP CCWSS Acronyms in this document CCW: Coca-Cola West M.Kyushu: Minami Kyushu Coca-Cola Bottling CCWV: Coca-Cola West Vending NNB: Nishinihon Beverage CCWES: Coca-Cola West Equipment Services MBS: Minami Kyushu Beverage Services KCS: Konan Coffee KCSC: Konan Customer Service CCWP: Coca-Cola West Products CCWDP: Coca-Cola West Daisen Products MCP: Minami Kyushu Coca-Cola products CCWSS: Coca-Cola West Sales Support (provisional) 24

26 [Reference] 25

27 Account settlement for Q3 (July-September) (Unit: MM JPY, %) 2013 Vs. Plan 2012 Vs. PY Q3 Actual Plan Q3 Actual Diff % Diff % Revenue 130, ,500-3, , , Gross profit on sales Operating income Ordinary profit Current net profit 65,227 68,600-3, ,591 +9, ,519 9,600-1, ,299 +1, ,344 9,400-1, , ,775 5, ,504 +1, [Ref] Coca-Cola business (Unit: MM JPY, %) 2013 Vs. Plan 2012 Vs. PY Q3 Actual Plan Q3 Actual Diff % Diff % Revenue 121, ,000-3, , , Operating income 6,800 8,000-1, ,719 +1, * Target refers to the figures based on the performance forecast published on July 26,

28 Trend of OTC market share (Except for VM) 100% (Unit: %, point) Other 38.3% 36.6% 36.8% 38.1% 37.6% D company C company B company A company CCW 8.3% % % % 7.5% 8.0% % % 7.4% % % 15.4% % % 15.5% % % % % -0.2 Q3 Q4 Q Q2 Q3 Values put on side of bars shows year-over-year variances. Data acquisition method of the research company has been changed since Q Along with this change, we revised year-over-year differences of the same period retroactively. The market share includes Minami Kyushu area from Q (Source: Intage) 27

29 Account settlement for Q3 YTD Mix by brand/by channel 2012 年 2013 年 Brand Channel Other I-Lohas Ayataka Aquarius Sokenbicha Georgia Fanta Coca-Cola Cola Zero Coca-Cola Cola Other Food Service Retail CVS Supermarket Vending 39% 11% 20% 販売数量 Volume Revenue 売上高 売上総利益 Gross profit on sales 3% 15% 8% 6% 5% 6% 10% 9% 12% 11% 20% 16% 29% 28% 5% 5% 6% 4% 3% 28% 10% 31% 48% 5% 6% 6% 4% 3% 24% 10% 31% 60% 6% 4% 4% 3 12% 19% 2 5% 6% 4% 3% 2 10% 30% 5% 6% 4% 4% 23% 10% 30% 8% 8% 6% 4% 4% 販売数量 Volume Revenue 売上高売上総利益 Gross profit on sales 4% 14% 8% 4% 6% 10% 8% 9% 11% 16% 11% 22% 31% 4 58% Volume Revenue Gross profit on sales Volume Revenue Gross profit on sales 28

30 Account settlement for Q3 (July-Sep) Mix by brand/by channel 2012 年 2013 年 Brand Channel Other I-Lohas Ayataka Aquarius Sokenbicha Georgia Fanta Coca-Cola Cola Zero Coca-Cola Cola Other Food Service Retail CVS Supermarket Vending 3 16% 16% Volume Revenue Gross profit on sales 14% 10% 11% 32% 26% 5% 6% 6% 4% 3% 26% 5% 11% 23% 4 22% 6% 8% 14% 25% 8% 6% 5% 3% 15% 25% 8% 9% 18% 58% 4% 4% 2% 6% 35% 16% 16% Volume Revenue Gross profit on sales 13% 9% 10% 35% 26% 5% 6% 5% 3% 26% 13% 25% 8% 8% 4% 8% 10% 24% 46% 6% 6% 5% 4% 22% 14% 25% 8% 8% 9% 18% 56% 9% 4% 4% 4% 5% Volume Revenue Gross profit on sales Volume Revenue Gross profit on sales 29

31 Sales update on vending machines by channel Vs. PY of VPM* of Full Service CAN VM CCW area Vs. PY (%) Sub-channel Jan Feb Mar Apr May Jun Jul Aug Sep Total At work white At work blue Mass retailer Transportation School Leisure Pachinko Sports facility Hospital Accommodation Other (Indoor) Outdoor Total Minami Kyushu area Total * Sales volume per vending machine 30

32 Account settlement for Q3 (July-Sep) Volume by channel [Ref] Real comparison (Unit: K cs, % ) Q3 Actual vs. Plan 1 Vs. PY Vs. PY 3 Diff % Diff % Diff % Super market 2 24, , , Convenience store 6, Chain store Total 31, , , Vending 17, , Retail 4, Food service 6, Other 8, Total 68, , * 1 Target refers to the figures based on the performance forecast published on July 26, * 2 Drug store/discounter/home center are included in supermarket. * 3 PY actual figures include July-Sep performance of Minami Kyushu CCBC. 31

33 Account settlement for Q3 (July-Sep) Volume by package [Ref] Real comparison (Unit: K cs, % ) Q3 Actual Vs. Plan 1 Vs. PY Vs. PY 2 Diff % Diff % Diff % SS (smaller than 1,000ml ) 20, , , MS (smaller than1,500ml) PET LS (1,500ml or larger) 16, , Total 37, , , Can (include bottle can) Other Syrup/Powder Total 15,052-1, , , , , , * 1 Target refers to the figures based on the performance forecast published on July 26, * 2 PY actual figures include July-Sep performance of Minami Kyushu CCBC. 32

34 Account settlement for Q3 (July-Sep) Volume by brand [Ref] Real comparison (Unit: K cs, % ) Q3 Actual Vs. Plan 1 Vs. PY Vs. PY 3 Diff % Diff % Diff % Coca-Cola 5, , Coca-Cola Zero 2, Fanta 3, Georgia 10, , Sokenbicha 4, Core 8RTD 2 Products Aquarius 11, , Ayataka 4, , Ilohas 3, Sub total 44, , , Other 11, , , , , Syrup/Powder Total 11, , , * 1 Target refers to the figures based on the performance forecast published on July 26, * 2 Packaged products * 3 PY actual figures include July-Sep performance of Minami Kyushu CCBC. 33

35 Account settlement for Q3 YTD volume by channel and package [Ref] Real comparison Chain Store Q3 YTD vs. Plan 1 vs. PY vs. PY 2 (Unit:K cs %) Actual Diff % Diff % Diff % SS PET (smaller than 1,000ml) 21, , , MS PET (smaller than 1,500ml) 1, LS PET (1,500ml or larger) 32, , , Can 10, , Other 2, Total 68, , , Vending Q3 YTD vs. Plan 1 vs. PY vs. PY 2 (Unit:K cs %) Actual Diff % Diff % Diff % SS PET (smaller than 1,000ml) 17, , , LS PET (1,500ml or larger) Can 23, , Other 2, Syrup/Powder Total 44, , , Retail & Food service Q3 YTD vs. Plan 1 vs. PY vs. PY 2 (Unit:K cs %) Actual Diff % Diff % Diff % SS PET (smaller than 1,000ml) 4, MS PET (smaller than 1,500ml) LS PET (1,500ml or larger) 1, Can 2, Other 1, Syrup/Powder 15, , Total 27, , , * 1 Target refers to the figures based on the performance forecast published on July 26, * 2 PY actual figures include April-Sep performance of Minami Kyushu CCBC. 34

36 Account settlement for Q3 (July-Sep) volume by channel and package [Ref] Real comparison Chain Store Q3 YTD vs. Plan 1 Vs. PY Vs. PY 2 (Unit: K cs, % ) Actual Diff % Diff % Diff % SS PET (smaller than 1,000ml) 9, , MS PET (smaller than1,500ml) LS PET (1,500ml or larger) 15, , Can 3, Other 1, Total 31, , , Vending Q3 YTD vs. Plan 1 Vs. PY Vs. PY 2 (Unit: K cs, % ) Actual Diff % Diff % Diff % SS PET (smaller than 1,000ml) 8, , LS PET (1,500ml or larger) Can 8, Other (bottle can, etc) 1, Syrup/Powder Total 17, , Retail & Food service Q3 YTD vs. Plan 1 Vs. PY Vs. PY 2 (Unit: K cs, % ) Actual Diff % Diff % Diff % SS PET (smaller than 1,000ml) 2, MS PET (smaller than1,500ml) LS PET (1,500ml or larger) Can 1, Other Syrup/Powder 6, Total 10, , * 1 Target refers to the figures based on the performance forecast published on July 26, * 2 PY actual figures include July-Sep performance of Minami Kyushu CCBC. 35

37 Q4 (Oct-Dec) Volume target by package [Ref] Real comparison (Unit: K cs, % ) Q4 Plan Vs. PY Vs. PY Diff % Diff % SS PET (smaller than 1,000ml) 13,493 +3, MS PET (smaller than1,500ml) PET LS PET (1,500ml or larger) 8,932 +1, Sub total 22,888 +5, , Can (include bottle can) Other Syrup/Powder Total 15,948 +2, , , , ,626 +8, PY actual figures include Oct-Dec performance of Minami Kyushu CCBC. 36

38 Q4 (Oct-Dec) Volume target by channel and package [Ref] Real comparison Chain Store Q4 Plan Vs. PY Vs. PY (Unit: K cs, % ) Diff % Diff % SS PET (smaller than 1,000ml) 6,370 +1, MS PET (smaller than1,500ml) LS PET (1,500ml or larger) 8,305 +1, Can 3, Other Total 19,802 +4, , Vending Q4 Plan Vs. PY Vs. PY (Unit: K cs, % ) Diff % Diff % SS PET (smaller than 1,000ml) 5,277 +1, LS PET (1,500ml or larger) Can 9,193 +1, Other (bottle can, etc) Syrup/Powder Total 15,541 +3, Retail & Food service Q4 Plan Vs. PY Vs. PY (Unit: K cs, % ) Diff % Diff % SS PET (smaller than 1,000ml) 1, MS PET (smaller than1,500ml) LS PET (1,500ml or larger) Can 1, Other Syrup/Powder 5, Total 9,417 +1, PY actual figures include Oct-Dec performance of Minami Kyushu CCBC. 37

39 Performance trend (Unit: MM JPY) target Revenue 117, , , , , , , , , , , , , , , ,600 OI 12,533 15,160 17,449 16,634 16,704 19,638 16,860 11,830 12,321 16,056 10,521 2,242 12,003 16,469 13,463 17,800 Ordinary profit Current net profit ,510 15,889 18,516 16,021 17,005 19,895 17,065 5,872 6,823 5,700 1,420 7,086 9,380 8,564 Jul 1, 1999 Merged with Sanyo CCBC Apr 5, 2001 Mikasa CCBC became a subsidiary Jul 1, 2006 Mgmt integration with Kinki CCBC 12,256 7,305 13,225 7,570 17,493 Apr 3, 2007 Capital & business alliance with Minami-Kyushu CCBC 11,048 2,085 12,659 16,044 13,845 17,900 9, ,594 7,582 6,997 6,031 17,700 Jan 1, 2009 CCWH, CCWJ, Kinki and Mikasa CCBCs merged Apr 1, 2013 Minami-Kyushu CCBC became a wholly-owned subsidiary Operating income Revenue Revenue (billion JPY) 0 98 年 99 年 00 年 01 年 02 年 03 年 04 年 05 年 06 年 07 年 08 年 09 年 年 年 12 年 13 年 Target 計画 Operating income (billion JPY) Oct 1, 2010 Q sai became a subsidiary 38

40 Changes of Management metrics <Operating profit/operating profit ratio> <Net asset/capital ratio> (MM JPY) OI (MM JPY) (%) (MM JPY) (%) Net asset(mm JPY) OI (%) 16, Capital ratio(%) 300,000 15,000 12,003 13, , , , , , , , ,000 10, , , ,000 2, , <Return on Assets (ROA)/ Return on Equity (ROE)> (%) ROE ROA (EPS:JPY) <Earnings per Share (EPS)/Price Earnings Ratio (PER)> , EPS PER EPS= Current net profit/average # of shares throughout the period PER = Year-end stock price/eps (PER:Times) 2,

41 Coca-Cola system in Japan - Funding relations Capital: Investment ratio, and % in ( ) refers to the one within CCW group total) (As of July 1, 2013) The Coca-Cola Company (TCCC) 2 (100%) (100%) Coca-Cola Tokyo Research & Development Co., Ltd (CCTR&D) 4 Coca-Cola (Japan)Co., Ltd (CCJC) 3 Joint companies of TCCC/CCJC and bottlers Coca-Cola Business Service Co., Ltd (CCBSC) 6 Coca-Cola Customer Marketing Company (CCCMC) 7 FV Corporation (FVC) % (21.1%) 20.1% (23.) 21. (25.9%) 5 Coca-Cola Cola West Co., Ltd (CCW) 100.0% 1 Minami Kyushu Coca-Cola Cola Bottling Co., Ltd Coca-Cola Cola East Japan Co., Ltd (CCEJ) Coca-Cola Cola Central Japan Co., Ltd Mikuni Coca-Cola Cola Bottling Co., Ltd Tokyo Coca-Cola Cola Bottling Co., Ltd Tone Coca-Cola Cola Bottling Co., Ltd % % 100.0% 100.0% 100.0% Coca-Cola Cola Bottling 6 Companies (CCBC) 40

42 Coca-Cola affiliated companies and their roles 1 Coca-Cola West Co., Ltd. (CCW) In 2006, CCWJ and Kinki CCBC merged the management of both companies by establishing a joint holding company CCWH. In 2009, CCWH, CCWJ, Kinki CCBC and Mikasa CCBC merged and the trade name changed to Coca-Cola West Co., Ltd. Minami Kyushu Coca- Cola Bottling Co., Ltd. became its wholly-owned subsidiary on April 1, The Coca-Cola Company (TCCC) Established 1919 in Atlanta, Georgia. Carries the rights to grant a license to manufacture and sell Coca-Cola products to the bottlers. TCCC (or its subsidiary) makes franchise agreements with the bottlers. 3 Coca-Cola (Japan) Co., Ltd. (CCJC) Established 1957 in Tokyo, as Nihon Inryo Kogyo K.K., a whollyowned subsidiary of The Coca-Cola Company. The company name was changed in 1958 to Coca-Cola (Japan) Company, Limited. CCJC is responsible for marketing planning as well as manufacturing and distribution of concentrate in Japan. 4Coca-Cola Tokyo Research & Development Co., Ltd. (CCTR&D) Established in January 1993 as a wholly-owned subsidiary of The Coca-Cola Company. Since January 1995, carries out product development and technical support to respond to the needs of the Asian region. 5 Coca-Cola bottlers (CCBCs) There are 12 bottlers in Japan, which are responsible for selling Coca-Cola products in the respective territories. 6 Coca-Cola Business Service Co., Ltd. (CCBSC) Established through joint investment by TCCC and its bottling partners in Japan, in June It is charged with providing business consulting services to the Coca-Cola system in Japan, as well as developing and generally maintaining the information systems to support such work. The company procures raw materials. 7 Coca-Cola Customer Marketing Company (CCCMC) Established through joint investment by Coca-Cola (Japan) Co., Ltd. and all of its bottling partners in Japan, and the company began operations on January 1, It is charged with holding business negotiations with major retailer outlets, such as nationwide convenience stores and supermarket chains, as well as developing proposals for sales promotions and storefront activities. 8 FV Corporation Co., Ltd. (FVC) Jointly established in May 2001 by CCBCs and CCJC. FVC carries out sales negotiations with national chain vending operators, and deals with non-ko products as well as KO products. 41

43 Glossary Term Explanation Channel Vending Retail sale business to distribute products through vending machines to consumers Chain store Wholesale business for supermarket chain Convenience Store (CVS) Wholesale business for convenience store chains Retail Wholesale business for grocery stores, liquor shops, and other over-the-counter outlets Food Service Syrup sale business for restaurants, movie theaters, sports areas and theme parks Vending Regular vending machine A vending machine offered free of charge to a customer who supervises its operation and uses it to sell products purchased from us Full service vending machine A vending machine installed and managed directly by us Out-market vendhing machine An outdoor machine whose users are relatively unspecific In-market vending machine An indoor machine whose users are relatively specific VPM Volume Per Machine VPPM Volume and Profit Per Machine Chain store National chain National chain supermarket that CCCMC are responsible for negotiating Regional chain Chain supermarket that owns its stores in the two or more bottlers' territories Local chain Chain supermarket that owns its stores in the single bottler's territory Other Trade marketing OBPPC Occasion, Brand, Package, Price, Channel PicOS Picture Of Success HORECA Hotel, Restaurant, Café, etc Trade marketing is a specific function that uses shopper and retail knowledge to develop in-store strategies that ultimately result in higher brand equity and an increase in the quantity and value of shopper purchases 42

44 Forward-looking statement The plans, performance forecasts, and strategies appearing in this material are based on the judgment of the management in view of data obtained as of the date this material was released. Please note that these forecasts may differ materially from actual performance due to risks and uncertain factors such as those listed below. - Intensification of price competition in the marketplace - Change in economic trends surrounding our business - Major fluctuations in capital markets - Uncertain factors other than those above 43